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Could you invalidate your prenuptial agreement by commingling your assets?

On Behalf of | Apr 17, 2021 | Property Division

Many couples sign prenuptial agreements before they get married to keep any assets that they owned before their marriage to themselves in the event of a divorce. 

Unfortunately, keeping one’s separate property truly separate isn’t always easy. Commingling those assets, however, can end up causing your prenup to fail you.

What is the commingling of assets?

Any money or property that you bring into your marriage is a separate asset. Any that you and your spouse acquire during your marriage are marital assets. Commingling involves mixing your assets in some way with your spouse’s assets after your marriage starts.

One way to avoid commingling assets is to set up your own separate bank account from your spouse and use it to hold whatever liquid assets you bring into the marriage. If you own real estate that’s separate property, you should keep clear records about any payments you make toward its upkeep — and make those payments only from your separate funds. 

How does commingling assets impacts property division in a divorce?

The way property division generally works in a divorce is that spouses can usually keep any of their separate assets. Hawaii is an equitable distribution state, though. Any marital property must be split fairly between spouses. 

When assets that were kept separate according to a prenuptial agreement are commingled, they can sometimes be transmuted into marital property — and then the prenup would no longer apply.

How to proceed in property division discussions involving commingled assets

There’s little that you can do to untangle the commingling of assets if it’s already happened. An attorney can provide guidance in structuring a property division settlement that may allow you to keep much of your hard-earned assets in your hands.

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